What’s in store for business travelers in 2008
Published airfares will increase up to four percent next year, while hotel average daily room rates in some markets may achieve double-digit increases, according to the BCD Travel 2008 Industry Forecast, powered by Advito. (9/20/2007)
“Over the past two years, we’ve seen strong, sustained growth in business travel, and this continues to drive industry prices higher,” said Mary Ellen George, GM - Advito, which provided data and trending for the forecast. “We expect growth – and higher prices – to continue through 2008.”
George said there is little room for error for companies struggling to control costs: “Tight market conditions are placing a higher demand on the skills and expertise of travel buyers and travelers to meet travel policy requirements and effectively conduct company business.”
The report’s key predictions, according to the corporate travel management company, were as follows:
· Airfare increases: Worldwide, published airfares are predicted to rise 2-4 percent on average in 2008. Advito expects corporate airfares to increase by less than two percent, thanks in part to an increase in corporate discounts.
· Hotel rates and supply: Advito expects the 2008 average daily room rate to increase by six percent to nine percent. Some markets may see double-digit increases. Although some European hotel markets are trending lower due to over-capacity, average daily rates in most markets are expected to continue to grow.
· Rail: Consolidation and privatization in European markets will push average rail fares upward in 2008. But increased productivity gains for traveler and travel arranger alike are expected with the introduction of rail booking through traditional channels.
· Meeting costs: Average group room rates will increase 8-10 percent in major markets in 2008. Global meeting planning is expected to be in direct correlation with company expansions into emerging markets. The Asia Pacific and Middle East regions are anticipated to be high-demand destinations.
· Car rental rates: Car rental rates will increase by 5-7 percent in 2008, continuing a trend predicted in 2006.
· Traveler frustration: We expect travelers will continue to experience extended flight times, escalating airport chaos due to flight cancellations and long lines at airport security checkpoints. Companies will need to focus on helping their travelers stay productive in less-than-optimal conditions.